The Court of Justice of the European Union (CJEU) ruled at the beginning of April that the mere storage of trademark infringing products by an online marketplace does not constitute an infringement of intellectual property rights. The CJEU has thus confirmed the previous ruling by the Munich District Court in the lawsuit between Amazon and the fragrances and cosmetics company Coty Germany. A prerequisite is that the service provider has no knowledge of the illegal activities.
The lawsuit was triggered by the sale of an infringing men’s fragrance of the Davidoff Hot Water brand by a third party seller as part of the Fulfillment by Amazon (FBA) program. With this, Amazon enables third-party retailers to have products stored, packaged, and shipped via the group’s logistics centers. Coty, licensee of the Davidoff brand, therefore accused Amazon of infringing its IP rights by storing and shipping the infringing products. In Germany, the case went as far as the Federal Court of Justice (Bundesgerichtshof, BGH). The BGH then asked the CJEU for a preliminary ruling on whether a third party, which unknowingly stores products that infringe trademark rights, possesses these goods for the purpose of offering or putting them on the market. This would enable the trademark owner to prohibit the use of a trademark (cf. Art. 9 of Regulation (EU) 2017/1001).
According to the CJEU, however, the storage of articles under the Fulfilment by Amazon program does not constitute a possession of the goods in this particular sense. Only the third-party trader pursues the goal of selling the products; Amazon has therefore not used the Davidoff trademark itself. In its statement of reasons, the CJEU cites earlier decisions that the term ‘use’ implies an active behavior and a direct or indirect control over the act of use. In the present case, this is only given for the third party provider.
However, the judgement is criticized for only addressing one partial legal aspect. “When products are sold via the so-called ‘fulfillment by Amazon’, Amazon not only stores the goods but also becomes active themselves”, comments Martin Fiebig from the law firm Lubberger Lehment, which represented the trademark manufacturer in the lawsuit. Fiebig further explained to the Anti-Piracy Analyst: “As Amazon itself is co-organizing the sales process, there is also the question of Amazon’s liability as a sales intermediary for taking on an active role. The CJEU explicitly left this question open in its ruling, and it now has to be clarified by the BGH.”
Advocate General Campos Sánchez-Bordona had previously also included a broader view in his Opinion, which serves as a proposal for a decision by the CJEU. Keeping with Amazon’s advertising slogan “Send us your goods – we’ll take care of the rest” („Senden Sie uns Ihre Ware – wir erledigen den Rest“), the Advocate General saw Amazon in an active role. In contrast, the CJEU deviated from the Advocate General’s assessment and did not see Amazon as liable in this case.
In another case last year, the law firm Lubberger Lehment, which specializes in IP law, achieved a spectacular success at the German Federal Court of Justice against trademark infringing advertising by Amazon.